US directs Fannie Mae, Freddie Mac to approve VantageScore for all lenders

Shares of Fair Isaac FICO.N, better known as FICO, plunged 20% in early U.S. trading on Friday.

They had slipped in April after Freddie Mac and Fannie Mae said they will now accept mortgages assessed using rival credit scoring system VantageScore 4.0.

Pulte's push to expand the use of VantageScore comes even as he criticized the three credit reporting agencies that own it.

In a separate post, Pulte said on Thursday that credit reporting agencies Equifax EFX.N, Experian EXPN.L and TransUnion TRU.N have been overcharging Americans for "far too long."

"Equifax, Experian, and TransUnion have been overcharging Americans for far too long. This will end soon. We are seriously considering bi-merge, and stronger solutions (SAFER and SOUNDER). We will not allow companies to take advantage of American consumers," he said.

Shares of TransUnion TRU.N slipped 9% and Equifax EFX.N lost 8% in U.S. trading, while London's Experian EXPN.L shed 4.6%.

Founded in 2006, VantageScore is a credit score modeling and analytics company jointly owned by Equifax, Experian and TransUnion.

The Trump administration says it intends to lower costs for American homebuyers and boost competition in the mortgage credit scoring market dominated by FICO.

In 2018, during his first term, President Donald Trump signed the Credit Score Competition Act into law, directing U.S. Federal Housing to enable Freddie Mac and Fannie Mae to approve more advanced credit score models for mortgage underwriting.

WASHINGTON, Sept 3 (Reuters) - U.S. Director of Federal Housing Bill Pulte said on Thursday he has directed Fannie Mae and Freddie Mac, created by the United States Congress to support the housing market, to approve all lenders to use credit scoring system VantageScore.